April 10, 2019

Cortez Masto Cosponsors Legislation to Expand Important Family Tax Credits

Washington, D.C. – U.S. Senator Catherine Cortez Masto (D-Nev.) joined Senators Sherrod Brown (D-Ohio), Michael Bennet (D-Colo.), Dick Durbin (D-Ill.), Ron Wyden (D-Ore.) and 39 Senate colleagues in introducing legislation that would help expand two tax credits aimed at putting money back in the pockets of hardworking Nevada families. The Working Families Tax Relief Act would expand access to and increase the value of both the Earned Income Tax Credit (EITC) and the Child Tax Credit (CTC).  

“Hard working families in Nevada are continuing to struggle to make ends meet. These common sense updates to the Earned Income and Child Tax Credits will help ensure all hardworking Nevadans are able to keep a little more of their hard-earned cash in their pocket so they can provide for their families. Our tax system should put middle-class and working families first, and I will continue to fight in the Senate to reverse the damage caused by the Republican tax bill and ensure that tax cuts go to those who need them, not to wealthy corporations.”

In addition to Senators Brown, Bennet and Cortez Masto, Senators Patrick Leahy (D-Vt.), Patty Murray (D-Wash.), Jack Reed (D-R.I.), Chuck Schumer (D-N.Y.), Tom Carper (D-Del.), Debbie Stabenow (D-Mich.), Maria Cantwell (D-Wash.), Bob Menendez (D-N.J.), Benjamin Cardin (D-Md.) Bernie Sanders (I-Vt.), Bob Casey (D- Penn.), Amy Klobuchar (D-Minn.), Sheldon Whitehouse (D-R.I.), Jon Tester (D-Mont.), Tom Udall (D-N.M.), Jeanne Shaheen (D-N.H.), Mark Warner (D-Va.), Jeff Merkley (D-Ore.), Kirsten Gillibrand (D-N.Y.), Chris Coons (D-Del.), Richard Blumenthal (D-Conn.), Brian Schatz (D-Hawaii), Tammy Baldwin (D-Wis.), Chris Murphy (D-Conn.), Mazie Hirono (D-Hawaii), Martin Heinrich (D-N.M.), Angus King (I-Maine), Tim Kaine (D-Va.), Elizabeth Warren (D-Mass.), Ed Markey (D-Mass.), Cory Booker (D-N.J.), Gary Peters (D-Mich.), Chris Van Hollen (D-Md.), Tammy Duckworth (D-Ill.), Maggie Hassan (D-N.H.), Kamala Harris (D-Calif.), Tina Smith (D-Minn.), Doug Jones (D-Ala.) and Jacky Rosen (D-Nev.).

BACKGROUND:

The Working Families Tax Relief Act would boost the incomes of 46 million households and 114 million people, and lift 7 million people, including 3 million children, out of poverty. Specifically, the legislation would:

  • Expand EITC for Childless Workers: Workers who do not claim children are the sole group that the federal tax system can tax into poverty or deeper into poverty. There is a small credit for workers not raising children in the home, but the maximum credit amount is $510 and the credit begins to phase out at $8,340 and phases out completely at $15,010. In addition, all workers that do not claim children and are younger than 25 are ineligible for the EITC. The result is that the EITC for a full-time, minimum-wage worker not claiming children is $27. The Working Families Tax Relief Act reduces the age limit to qualify for the EITC from 25 to 21 and expands the size of the credit so the same full-time, minimum wage worker would earn a refundable credit of approximately $913.
  • Strengthen the Child Tax Credit for Families with Young Children: The bill builds on the proven success of the CTC to lift children out of poverty. The legislation will focus on the most vulnerable children by allowing taxpayers to claim a refundable credit equal to 45 percent of each dollar earned up to a maximum credit of $3,000 per-child under six years of age.
  • Index the CTC to inflation: A recent study from Columbia University concluded that if the CTC is not indexed, 750,000 children under 17 and their families will fall below the poverty line by the end of the decade. The bill would index the maximum CTC and the income thresholds at which the credit begins to inflation.
  • Make it easier to claim the EITC: The bill includes a pair of bipartisan measures, originally proposed by the George W. Bush Administration, designed to simplify and clarify who can claim a child. The first proposal simplifies the complicated rules for how parents who are separated can claim the EITC. The second proposal allows filers who live with a qualifying child, but do not claim the child for the EITC, to claim the childless EITC proposed in the bill.

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